Correlation Between Catella AB and Mekonomen
Can any of the company-specific risk be diversified away by investing in both Catella AB and Mekonomen at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Catella AB and Mekonomen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Catella AB A and Mekonomen AB, you can compare the effects of market volatilities on Catella AB and Mekonomen and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Catella AB with a short position of Mekonomen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catella AB and Mekonomen.
Diversification Opportunities for Catella AB and Mekonomen
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Catella and Mekonomen is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Catella AB A and Mekonomen AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mekonomen AB and Catella AB is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Catella AB A are associated (or correlated) with Mekonomen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mekonomen AB has no effect on the direction of Catella AB i.e., Catella AB and Mekonomen go up and down completely randomly.
Pair Corralation between Catella AB and Mekonomen
Assuming the 90 days trading horizon Catella AB is expected to generate 4.38 times less return on investment than Mekonomen. In addition to that, Catella AB is 1.68 times more volatile than Mekonomen AB. It trades about 0.01 of its total potential returns per unit of risk. Mekonomen AB is currently generating about 0.07 per unit of volatility. If you would invest 10,206 in Mekonomen AB on September 12, 2024 and sell it today you would earn a total of 3,354 from holding Mekonomen AB or generate 32.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Catella AB A vs. Mekonomen AB
Performance |
| Timeline |
| Catella AB A |
| Mekonomen AB |
Catella AB and Mekonomen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catella AB and Mekonomen
The main advantage of trading using opposite Catella AB and Mekonomen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catella AB position performs unexpectedly, Mekonomen can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Mekonomen will offset losses from the drop in Mekonomen's long position.| Catella AB vs. Catella AB | Catella AB vs. Svolder AB | Catella AB vs. Beijer Alma AB | Catella AB vs. BTS Group AB |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |